The Singapore International Commercial Court ("SICC") started hearing its first case this month: a US$809 million dispute between Australian and Indonesian companies over a joint venture agreement for the production and sale of upgraded coal from East Kalimantan in Indonesia. The opening of the SICC in January 2015 marks a milestone in Singapore's push to become an international dispute resolution hub.
The SICC is specifically designed to deal with transnational commercial disputes. While the new court has a global mandate, it promises to be a particularly reliable and efficient forum for resolving cross-border disputes in Asia. This Commentary sets out a brief overview of the SICC's key features, including its jurisdiction, composition, and procedures.
The Supreme Court of Singapore comprises the High Court and the Court of Appeal. The SICC sits within this structure as a division of the High Court. This means that SICC judgments are enforceable as judgments of the High Court and, in certain cases, are appealable to the Court of Appeal. However, the SICC differs from a typical municipal court in that it has no inherent jurisdiction to hear disputes, except contempt proceedings in respect of its own judgments and orders. Generally, the SICC has jurisdiction to hear an action if:
- The claim in the action is of an "international" and "commercial" nature;
- The parties to the action have submitted to the SICC's jurisdiction under a written agreement (for example, under a choice of jurisdiction clause); and
- The parties to the action do not seek any relief in the form of, or connected with, a prerogative order (such as a mandatory order, a prohibiting order, a quashing order or an order for review of detention).
- In general terms, a claim will be considered "international" if one of the following criteria is satisfied:
- The parties have their place of business in different states;
- None of the parties has its place of business in Singapore;
- The commercial relationship between the parties involves obligations which are to be substantially performed outside any state in which any of the parties has its place of business;
- The place most closely connected to the subject matter of the dispute is outside any state in which any of the parties has its place of business; or
- The parties have agreed expressly that the subject matter of the dispute relates to more than one state.
A claim will be considered "commercial" if it arises from any relationship that is commercial in nature, such as trade transactions, distribution agreements, construction works, consulting, engineering or licensing transactions and joint ventures.
There is an exception to the requirement for the parties to consent to the jurisdiction of the SICC if a case is transferred to the SICC by the High Court. The High Court may transfer a case, either on a party's application or on its own motion, if it considers that:
- The claim in the action is of an "international" and "commercial" nature;
- The parties to the action do not seek any relief in the form of, or connected with, a prerogative order;
- The SICC will assume jurisdiction in the case; and
- It is more appropriate for the case to be heard in the SICC.
For example, it is expected that proceedings before the High Court which relate to international arbitrations seated in Singapore may be transferred to the SICC.
SICC Panel of Judges
Disputes referred to the SICC will be dealt with by one or three judges. The precise number of judges will be determined by the SICC at its discretion. Claims of relatively high value or those involving complex factual or legal issues are more likely to be heard by three judges.
The SICC panel consists of a mixture of local Singaporean judges (who currently sit on the High Court and the Court of Appeal) and international judges. There are currently 12 international judges on the SICC panel, from both civil and common law jurisdictions. These are: Ms Carolyn Berger (United States of America); The Hon. Justice Patricia Bergin (Australia); Mr Roger Giles (Australia); Dr Irmgard Griss (Austria); Justice Dominique T. Hascher (France); Mr Dyson Heydon AC QC (Australia); Sir Vivian Ramsey (United Kingdom); Mr Anselmo Reyes (Hong Kong); The Rt. Hon. Sir Bernard Rix (United Kingdom); Prof. Yasuhei Taniguchi (Japan); Mr Simon Thorley QC (United Kingdom); and Sir Henry Bernard Eder (United Kingdom).
For those involved in cross-border commerce, one of the advantages of the SICC is greater freedom of representation. In view of the international nature of SICC proceedings, parties are entitled to be represented by foreign lawyers (that is, lawyers who are not qualified in Singapore) in certain circumstances. In particular, a party may be represented by a foreign lawyer in "offshore cases" which have no substantial connection with Singapore.
Every foreign lawyer representing a party in proceedings before the SICC must be registered under section 36P of the Legal Profession Act (Cap 161).
Proceedings in the SICC are not governed by domestic procedural rules. The SICC has developed its own comprehensive set of rules and practice directions which follow international best practice, with particular reference to the English Commercial Court Guide. The SICC rules differ from those used in proceedings before the Singapore domestic courts in three key aspects:
- The SICC is not bound by the Singapore rules of evidence unless the SICC decides to apply such rules in accordance with the Rules of Court;
- Even where Singapore's rules of evidence are applicable, the SICC may allow any questions of foreign law to be determined on the basis of submissions instead of formal proof by experts; and
- There are separate procedures and practices for the production of documents, interrogatories and the joinder of parties to a proceeding.
Unlike a traditional court, the parties can agree to waive, limit or vary their rights of appeal from decisions of the SICC, provided such agreement is made in writing.
Enforcement of SICC Judgments and Orders
Singapore has a number of reciprocal enforcement agreements which allow for easier recognition and enforcement of Singapore court judgments in many countries, particularly Commonwealth countries such as the United Kingdom, India and Australia. However, there are several key jurisdictions (such as the United States and many ASEAN countries) where, currently, Singapore court judgments can be enforced only to the extent permitted by the common law or other applicable domestic laws. It is generally easier to enforce arbitral awards than court judgments, particularly in the 155 contracting states to the New York Convention.
Singapore recently took steps to address this issue by signing the Hague Convention on Choice of Court Agreements (the "Convention"). Where parties have expressly chosen a court of a member state to resolve their disputes, the Convention provides that judgments by that court must be recognised and enforced by the courts of other member states. The European Union and the United States have also signed but not yet ratified the Convention. Once the Convention comes into force and is ratified by Singapore, the number of jurisdictions in which SICC judgments can be enforced will increase. For further information on Singapore's signing of the Convention and its implications, please refer to our earlier Commentary.
In addition, the Supreme Court is working with the Singapore government and other court systems to streamline the enforcement of judgments under traditional common law rules. In January 2015, the Supreme Court entered into a nonbinding "memorandum of guidance" with the Dubai International Financial Centre Courts concerning the reciprocal enforcement of money judgments. In the absence of a formal treaty between the two jurisdictions, the memorandum of guidance is expected to simplify the enforcement process for judgments of the respective courts.
The SICC is another credible option in Singapore's toolkit of dispute resolution forums, which also includes the Singapore International Arbitration Centre and the Singapore International Mediation Centre. The SICC will not replace those institutions, but it will be an attractive choice for businesses that feel more comfortable having their cross-border disputes resolved in a reliable court system in a neutral venue. The SICC has many advantages over domestic court systems in Asia-Pacific, including a flexible process tailored to international disputes, a commercial approach, a strong panel of judges with international expertise and the freedom to use international counsel in "offshore cases" involving foreign legal systems.